Kingsley U.N Chikwendu
With the country feeling more stinging economic effects of recession, it is understandable that one of the signs of it is the rise in prices of goods and services. Prices of commodities may still be on the rise including the cost of building a home, it will continue to rise. Over the years, costs of several building materials have continue to go up.
Prior or when the present civilian dispensation was ushered in 1999, cement was sold at the rate of N500 per bag. Despite the coming of successive governments, introducing various housing policies, the price of cement has continued to rise till this day.
Since 2015, the price of cement rose from N1,400 to between N2,500 across the country. Last month, a bag was sold for between #2600 to #2800 in Nyanya Gwandara, one of the satellite towns close to Abuja but, today, a bag cost between #3000 to #3200. Even in Lugbe, Abuja, that is the present cost of a bag of cement.
Same goes for plywood. In October 2016, it cost around N2,500 to buy ¼ white plywood board but, in April 2017, the same plywood was sold for N4,200 per unit. Today, the price is continuing to go high.
This is becoming a challenge for developers, the government, Nigerians planning to rent or buy property as well as other stakeholders. In fact, it is becoming worrisome to the country at large, going by the number of collapse buildings we have seen or witnessed over the years.
With the incessant rise in prices of not just building materials, many developers and engineers will be tempted to cut corners so as to ensure that they make something out of a building project they may be carrying out either for the government or private individuals. They will more tempted with the feeling that they need to remain in business to make ends meet.
As a result, some or most of the building materials used or the building itself may not meet international or national standards which most likely lead to building collapse. If 50 bags of cement may be needed to mix some measurements of gravel, some developers or contractors may decide to reduce the number of bags to 25 or 30 so as to make gains or ensure that the projects or buildings are not abandoned.
Also, with the devaluation of the Naira and high exchange rate compared to the American Dollar, prices of building material have recorded about 150 to 200 percent increase as most building materials are imported. Apart from a bag of cement that has seen its price skyrocketed, the cost of rod has also gone from N160, 000 per tonne to N320, 000 and still rising.
Even prices for tonnes of washed gravel have gone up, a tipper of granite 30 tonnes have also increased. This is having a negative consequence and has impacted severely on many projects, private or public. Some can no longer continue or are struggling to complete their buildings due to high cost of most building materials.
Subsidy May Be the Way Forward.
Prior to the recession and now that the country is in it, many will continue to pay more for accommodation in major cities and satellite towns around them until costs of building materials are subsidised. Many completed housing still remain unoccupied because of the high rental and sale price tags on them. Note that majority of Nigerians are low income earners.
In addition, with the present economic recession the country is in, it is becoming worse. There may be more increase in prices of general commodities and knowing that the rise in prices of building materials has multiplier effects on housing development, many projects may be difficult to be completed.
This will have damning effects on housing development in the country and it’s definitely going to affect the country’s economy as a whole because, improvement in housing could have a catalytic effect on other sectors of the economy.
It is time for the government to establish more policies that will be aimed at bringing down the cost of building materials.